Exemptive Relief Applications - application for mutual fund prospectus lapse date extension.
Applicable Ontario Provisions
Securities Act, R.S.O. 1990, c. S.5, s. 62(5).
IN THE MATTER OF
THE SECURITIES LEGISLATION OF
BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN,
MANITOBA, ONTARIO, QUEBEC, NEWFOUNDLAND
AND LABRADOR, PRINCE EDWARD ISLAND,
NOVA SCOTIA AND NEW BRUNSWICK
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEW SYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
IN THE MATTER OF
DYNAMIC MANAGED FUTURES HEDGE FUND
MRRS DECISION DOCUMENT
WHEREAS the Canadian securities regulatory authority or regulator (the "Decision Maker") in each of the Provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, Newfoundland and Labrador, Prince Edward Island, Nova Scotia and New Brunswick (the "Jurisdictions") have received an application from Matisse Investment Management Ltd. ("Matisse") on behalf of the Dynamic Managed Futures Hedge Fund (the "Fund") for a decision under the securities legislation of the Jurisdictions (the "Legislation") that the lapse date for the prospectus of the Fund, as prescribed by the Legislation, be extended;
AND WHEREAS under the Mutual Reliance Review System for Exemptive Relief Applications (the "System"), the British Columbia Securities Commission is the principal jurisdiction for this application;
AND WHEREAS Matisse has represented to the Decision Makers that:
1. the Fund is an open-end trust established under the laws of British Columbia;
2. Matisse is the manager, trustee and promoter of the Fund;
3. the units of the Fund (the "Units") are qualified for distribution in each of the Jurisdictions under a prospectus of the Fund dated August 1, 2003 filed with each of the Decision Makers (the "Current Prospectus") for which a receipt was issued by each of the Decision Makers dated August 6, 2003;
4. Goodman & Company, Investment Counsel Ltd. ("Goodman") has entered into a share purchase agreement ("Share Purchase Agreement") with Asset Logics Capital Management Inc. ("Asset Logics") whereby Asset Logics will purchase control of Matisse;
5. an application for the change of control of Matisse has been filed with the Decision Makers and 60 days notice was given to unitholders of the Fund of the change in control of Matisse as required under National Instrument 81-102 - Mutual Funds;
6. an amendment to the Current Prospectus disclosing the proposed change of control will be filed on or before August 11, 2004;
7. the Current Prospectus, together with the amendment thereto, constitutes full, true and plain disclosure of all material facts relating to the offering of the Units;
8. Asset Logics intends to change the name of the Fund and replace the current registrar and administrator of the Fund effective on the closing of the share purchase transaction between Goodman and Asset Logics, the day after the expiry of the 60 day notice period;
9. Matisse, on behalf of the Fund, has filed a pro forma prospectus dated June 28, 2004 (the "Pro Forma Prospectus") and related documents with each of the Decision Makers as part of its annual renewal prospectus filing;
10. Matisse, on behalf of the Fund, intends to file a renewal prospectus of the Fund (the "Renewal Prospectus") with each of the Decision Makers, to ensure the Units continue to be qualified for distribution in the Jurisdictions beyond the lapse date for the Current Prospectus;
11. the closing of the Transaction is September 20, 2004, which is after August 11, 2004, the date which the Renewal Prospectus of the Fund is required to be filed in most of the Jurisdictions;
12. the closing of the Transaction will require numerous changes be made to the prospectus of the Fund to remove all references to Dynamic (except in respect of the financial statements and historical name of the Fund) pursuant to the Share Purchase Agreement and to reflect information on the new directors and officers of Matisse and the new ownership of Matisse, which changes would require the filing of an amended and restated prospectus shortly after filing of the Renewal Prospectus, incurring additional costs related thereto, if the lapse date extension were not provided;
13. the Renewal Prospectus will contain full, true and plain disclosure of all material facts related to the offering of the Units; and
14. under the Legislation, the lapse date of the Current Prospectus in British Columbia and certain of the Jurisdictions is 12 months after the date of the current Prospectus and in Quebec is 12 months from the date of the receipt of the current Prospectus;
AND WHEREAS under the System this MRRS decision document evidences the decision of each Decision Maker (collectively, the "Decision");
AND WHEREAS the Decision Makers are of the opinion that it would not be prejudicial to the public interest to make the Decision;
THE DECISION of the Decision Makers pursuant to the Legislation is that the time periods provided by the Legislation as they apply to the continued distribution of Units under the Current Prospectus for the Fund (including the time periods that apply to the filing and receipt of the Renewal Prospectus) are extended to the time periods that would be applicable if the lapse date in the Legislation for the distribution of Units under the Current Prospectus was September 11, 2004.
August 11, 2004.
"Andrew S. Richardson"